Someone who is deeply linked to the Christian right, and to the current Administration, has turned around and started what has become the world's most powerful private mercenary army. These guys are like neo-Crusaders. To have them on the government payroll to the tune of $750 million, operating in a Muslim country, should be frightening to everyone who understands that.

Why is the United States of America using mercenaries to fight its wars in the Middle East? How did Blackwater and other "private security" firms rise to a position of seeming respectability and wealth? Exactly what is the value of these entities to Bush and the neoconservatives who have shaped his administration? Jeremy Scahill answers these questions and more in this dialogue with BuzzFlash about his new book, Blackwater: The Rise of the World's Most Powerful Mercenary Army.

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BuzzFlash: Your new book details the privatization and outsourcing of many military functions to corporate entities. Why have we done that?

Jeremy Scahill: In many ways, Blackwater represents the life's work of the neoconservative core that has guided the Bush Administration since it first took power in 2000. Dick Cheney was Secretary of Defense under George H.W. Bush. One of the major initiatives that he carried out as Defense Secretary was to hire a subsidiary of Halliburton, the company he would go on to head, to study ways to privatize the military bureaucracy -- radically privatize it. He and Donald Rumsfeld worked together through the 1990s with groups like Project For the New American Century and the American Enterprise Institute, pressing ahead with this privatization agenda while they themselves were not in government.

Once they took power again, Donald Rumsfeld, in one of his first major addresses, on September 10, 2001, stood before the gaggle of former corporate CEOs and executives that would make up the core of the civilian leadership of the Pentagon. He said, "I have no desire to attack the Pentagon; I want to liberate it. We need to save it from itself." What Rumsfeld meant was that he intended to enact nothing short of a revolution in military affairs.

That revolution brought increased use of special forces, increased privatization, and unprecedented use of private soldiers and other contractors in the waging of America's wars.

The day after he announced that initiative, of course, the 9/11 attacks happened. That gave the Administration a blank slate on which to paint its radical overhaul of how the United States wages its wars. Now, six years later, we have upwards of 100,000 private contractors in Iraq. They are subjected to no effective laws. There's almost no oversight. They operate with almost no transparency.

What's the difference between having covert operators in clandestine operations, and overt operators over which there's no oversight or transparency, or effective legal mechanisms to control what they're doing?

It really boils down to an absolute subversion of the nation-state and what little semblance of democracy we have in this country. The American people are against the war. But the Administration no longer needs to turn to the army of the country to fight its wars. It can now hire mercenaries from all over the world. So we really are seeing a subversion of democratic processes, a subversion of the electoral system in this country, and a waging of aggressive, offensive wars using private soldiers.

BuzzFlash: I believe you state that 48,000 of these contractors are soldiers.

Jeremy Scahill: According to the Government Accountability Office, 48,000 employees of private mercenary firms are operating in Iraq alone. Those are the ones that are being tracked, and the tracking is very loose. I believe the number is much higher. Some people have estimated that as many as 70,000 private armed forces are operating in Iraq, not including the Iraqi militias. Blackwater has been paid $750 million by the State Department alone since the summer of 2004 to guard senior U.S. officials in Iraq, and, to a lesser extent, in Afghanistan. They are really the Praetorian Guard of the occupation in Iraq. This is an incredible revolution in the waging of U.S. wars.

BuzzFlash:Robert Greenwald, in his film about profiteering in Iraq, also addressed the issue of mercenaries. You and he both have pointed out that some of these men are paid up to $1,000 a day, and that many of the G.I.s resent them. They're doing a similar job, but without any of the legal constraints the G.I.s have, and they're making large amounts of money. To what extent is this neocon vision of a privatized military one that also involves profiteering and rewards to their supporters?

Jeremy Scahill: Well, Blackwater really captures everything that you just said there. We're talking about a company that was founded by a man named Erik Prince, who comes from a family that was one of the top bank rollers of, not only the "Republican revolution" of the 1990s that brought Newt Gingrich and the Contract with America to power, but also the rise of what we now know as the religious right or the Christian conservative movement. Erik Prince's family helped James Dobson found Focus on the Family. Erik Prince's family gave the seed money for Gary Bauer to found the Family Research Council. Erik Prince himself is a major bank roller of President Bush, his allies, and the Christian conservative movement in this country.

Someone who is deeply linked to the Christian right, and to the current Administration, has turned around and started what has become the world's most powerful private mercenary army. These guys are like neo-Crusaders. To have them on the government payroll to the tune of $750 million, operating in a Muslim country, should be frightening to everyone who understands that.

The fact of the matter is that this Administration has hired what is effectively a Christian army to operate in Muslim countries. This is very frightening to anyone who cares about civil liberties and the future of democracy and democratic processes. The fact is that these contractors provide the Bush Administration with an extraordinary level of political expediency. Their deaths don't get counted. Their crimes don't get reported or prosecuted. They're effectively a shadow army operating at the behest of an Administration waging a rogue war.

BuzzFlash: One of the issues you touch upon is that these mercenaries are not subject to any court of law. If I recall, a few allegedly committed atrocities in Iraq, and they're simply sent home.

Jeremy Scahill: First of all, the law that technically governs contractors and mercenaries in Iraq is provided under the Military Extraterritorial Jurisdiction Act of 2000. Basically what that said is that the FBI and the U.S. attorneys in the United States are responsible for prosecuting contractor crimes committed in Iraq or Afghanistan. With 100,000 contractors running around Iraq, what prosecutor from Virginia is going to fly over to Iraq, investigate a murder, interview Iraqi witnesses, then capture this person, bring them back to the United States, and prosecute them? It's one of the most ridiculous, fanciful concepts that I've seen in this war.

The mercenary industry loves the current state of affairs is because it's totally unenforced. On paper, yes, there's a law that governs contractors in Iraq. In reality, only one contractor has been indicted for any crime or violation in Iraq. Either we have 100,000 saints running around as contractors in Iraq, or something is very rotten. I happen to think that something is very rotten.

BuzzFlash: I think it's important to point out that this is not something that most Americans put at the top of their dance card as a concern. They may say, well, it's over in Iraq and that's a mess anyway. But, sure enough, after Hurricane Katrina, we saw Blackwater in New Orleans.

Jeremy Scahill: When Hurricane Katrina hit, Blackwater started a domestic operations division of its company, and it began seeking greater contracting opportunities domestically inside of the United States. At one point, the federal government was paying Blackwater about $240,000 a day for Hurricane Katrina. The company was billing the government $950 per day, per Blackwater man deployed in the hurricane zone. They had about 600 guys stretched from Texas all the way through the Gulf region.

Now Blackwater's been in negotiations with several state governments in the United States. Blackwater met recently with California Governor Arnold Schwarzenegger about doing disaster response in California. They're opening up a new private military base in San Diego. Another one is in Mount Carroll, Illinois. They have applied for operating licenses in every coastal U.S. state. This is the expansion of a privatized army.

Erik Prince, the founder of Blackwater, speaks boldly about Blackwater being the FedEx of the national security apparatus. They're manufacturing surveillance blimps and trying to market them to the Department of Homeland Security to use to monitor the U.S.-Mexico border. Meanwhile, Blackwater and its executives continue to pour money into these Christian conservative causes, conservative politicians' campaign coffers. This is really the embodiment of everything that President Eisenhower warned against in his farewell address, when he talked about the dangers of unchecked power of the private sector, and the rise of the military-industrial complex.

BuzzFlash: Let's get back to the issue that privatization comes at a high cost to the taxpayer. It's not as though someone else is paying for Blackwater. We are. This Administration has been giving inflated contractual reimbursement to companies like Blackwater at the expense of our military. As we learn in Robert Greenwald's "Iraq for Sale," a lot of GIs say they resent Blackwater and don't see why these guys are getting paid $1,000 a day.

Jeremy Scahill: One of the things that has happened as a result of these mercenary forces is that there's been a real drain to the special operations community. Special operations commanders have spoken quite openly about this, saying that they're in a real crisis right now for numbers. U.S. taxpayers are spending tens of millions of dollars, in some cases, to train U.S. Navy SEALs, or Delta Force, or Army Rangers, or Green Berets. The taxpayers shoulder the financial burden of training these elite forces, and then Blackwater and other companies come around and hire them away. Then they repackage them to the federal government and say it's much cheaper to pay our guys because you don't have any of the overhead of deploying them. We'll absorb the cost of that. But they never take into account that they're essentially taking money out of the public sphere that was spent on these soldiers in the active duty military. They're taking all of that training that U.S. taxpayers have paid for, taking it away from the military, and repackaging it as a privatized entity.

That is essentially a bilking of the U.S. taxpayer. The whole model of these privatized armies really is a rip-off of the American taxpayer. It's ridiculous when the industry lobbyists say they're a cheaper alternative to the bloated military. They're taking advantage of what they called the bloated military.

BuzzFlash: And we pay the individual soldier, aside from the profit the company makes, as much as ten times what we would pay the G.I. who's in the military rather than in a mercenary force.

Jeremy Scahill: We understand that upwards of 770 contractors have been killed in Iraq. That's just what's been documented by the U.S. Department of Labor, since federal insurance is required for contractors to operate in Iraq and other war zones. The actual number is likely much higher. The fact is that these contractors are limited in the amount of armor they want to give their personnel, the kind of protections they want to give their personnel, only by how much they're willing to spend on it. The military is limited by budget, by lack of supplies, by lack of political will on the part of the White House, and to a lesser extent, Congress, to get the armor over to the soldiers. So many contractors are dying in Iraq because of not being in armored vehicles, or being in helicopters with inadequate tracking devices or defense mechanisms. It really is a scandal. We've had families of U.S. soldiers sending armor over to them in Iraq, and these mercenaries have all the money in the world to spend on this stuff, yet they still cut corners in the interest of profits. That's why their guys are getting killed.

BuzzFlash: Okay, let's step back from our own perspective, and try to get into the mind of a Rumsfeld or a Cheney. Mercenary forces allow the Bush Administration, in this case, to wage wars without having to defy public opinion, because they just send in the mercenaries. But we have in Iraq a mixed bag. The military is still the predominant force, with the mercenaries as the secondary force, although a significant one. But this almost defies common sense. What is going through the mind of a Cheney or a Rumsfeld that makes this seem sensible?

Jeremy Scahill: I can't pretend to get into the minds of either of those men. But what I will say is I think both of them, throughout their careers, have really pushed for running the government like a corporation. At one point, Donald Rumsfeld said that because governments can't die, you have to find other incentives to sort of keep competition alive.

This Administration brought in an incredible number of people from corporate America to run the Pentagon. You have the neoconservative ideologues, on the one hand, and then you have the weapons manufacturers on the other hand. That made up the core of the Pentagon leadership. They're obsessed with running government like a venture capital firm.

And that has a number of benefits to it. It really removes the Congressional oversight factor from the equation when you're operating with an increased presence of the private sector. Also, you keep corporations alive and profitable. You're able to keep the businesses of your friends and your political supporters alive. We've seen an absolute revolving door between the weapons manufacturers, the war servicing companies, the mercenary companies, and the Republican Party and the Republican leadership, and this Administration.

This is part and parcel of running the government like a corporation, where the citizens are essentially subjects of this privatized government. The military is perhaps the most prominent example of that right now, but we also see it in our schools, prisons, state and local governments, and in law enforcement agencies. The fact is, in the United States right now, there are more private security operators than there are actual police officers. That's an extraordinary development in the history of privatization.

BuzzFlash: It's radical to the point of almost being anarchistic. They're way out there in terms of their ideology, basically almost hoping that the government is not only run by a corporation, but almost is a corporation. Then what we have is not a democracy, but a corporate-ocracy, perhaps one can call it.

Jeremy Scahill: Let's look at something that has gotten a really low amount of media coverage and attention, but it was an extraordinary development in the Iraq occupation. When the Bush Administration failed to build a coalition of willing nations, these contractors went into countries, many of whose home governments opposed the Iraq war or refused to send troops. The contractors aggressively recruited people from their special forces community, from their military, and then deployed them to Iraq as part of this private force, in some case, in contravention of their local laws. Blackwater and other mercenary companies brought over 750 Chilean mercenaries to operate in Iraq. Some of them had trained and served under the brutal regime of Augusto Pinochet, which I document in my book.

In Honduras, another American mercenary company recruited soldiers that had actually been withdrawn from Iraq by the Honduran government after John Negroponte was named Ambassador to Iraq. This company then rehires them -- those exact soldiers -- and sends them back to Iraq. That is a total subversion of the nation-state. It's flushing the constitutions and governments of these countries down the toilet. And many of these Latin American countries have suffered before under the hegemonic policies of the United States, where you had death squads, neo-liberal economic policies, military juntas. These are already victimized states, and then the United States further stomps on their rights by subverting their local democratic processes and sending their soldiers to Iraq in contravention of the will of their people and government.

BuzzFlash: Who do these forces report to? Who do they get assignments from? What are they supposed to do, beyond guarding Paul Bremer and other VIPs?

Jeremy Scahill: Blackwater is a little bit different than some of the other mercenary companies because Blackwater is really viewed within the industry as the elite. They have about 2300 men actively deployed around the world and another 20,000 troops on standby that they can call on at a moment's notice to deploy wherever. The vast majority of Blackwater's contracts in Iraq are not with the Pentagon. They're actually with the U.S. State Department. Blackwater is guarding not just the U.S. ambassador, and the various U.S. occupation outposts around the country, but also ninety Congressional delegations that have gone in and out of Iraq, including Nancy Pelosi. So the United States has outsourced the protection of its most important officials.

Blackwater has been paid over $750 million just to do those services for the State Department. But you have contractors working at every level of the occupation, guarding food convoys, guarding Iraqi officials, protecting people from corporations. It's like the Wild West over there. And there are numerous reports of extraordinary violence being committed on the part of contractors. Yet there are no prosecutions. It is really a devastating blow to democratic processes, and an ominous development in world history.

BuzzFlash: One of the most infamous incidents that brought the issue of Blackwater and the mercenaries searingly into the public consciousness was the killing of the men who were pulled from their vehicle and hung from a bridge. Some of the families, if I understand correctly, are currently suing Blackwater, and they appeared before Congress. What happened in that incident?

Jeremy Scahill: A convoy of two Blackwater contractors in a Jeep, leading three empty flatbed trucks being driven by Iraqis, followed by another Jeep with two other Blackwater troops in it, entered an intersection in the city of Fallujah. Their mission was to go to the other side of Fallujah, pick up some kitchen equipment, and bring it back to a base on the other side. At the time, Fallujah was considered a no-go zone for the U.S. military. Anyone from the U.S. government that would have traveled there would have been in heavily armored vehicles with all sorts of backup. These guys were driving in almost completely unarmored Jeeps. They had a reinforced bumper that they had sort of jerry-rigged before they left on the trip.

They drive into the center of Fallujah. They hit some kind of a roadblock. Insurgents ambush them, shoot up their vehicles. The bullets pierce through the Jeeps like salt through ice. The men in the rear vehicle are killed first. The men in the lead vehicle turn around to either go back and try to help them, or to flee the scene. But the insurgents target them as well. Within moments, their bodies are on fire and being torn apart by a mob. Some of their corpses are tied to the back of vehicles and dragged through the streets, and then two of the men's bodies were hung from a bridge over the Euphrates River. Iraqis are dancing in the streets. Some people are holding up signs that say Fallujah is the graveyard of the Americans.

It really, in many ways, was the Mogadishu moment of the Iraq war. Except in this case, unlike the Clinton Administration, which pulled out of Somalia in the early 1990s after US troops were killed there and dragged through the streets, the Bush Administration determined to absolutely crush the resistance in Iraq. And this was over the deaths of four private contractors, not active duty soldiers. The U.S. laid siege to Fallujah a few days later, killing hundreds of Iraqis, forcing thousands and thousands from their homes. It was the first of what would be several sieges of Fallujah. And the killing of those Blackwater men and the subsequent revenge attack by the United States really was what gave tremendous spark to the Iraqi resistance that haunts the occupation to this day. It was absolutely a turning point.

BuzzFlash: Why are some of the families suing Blackwater?

Jeremy Scahill: I've gotten to know these families very well over the past couple of years, and have gotten very deeply into their story. They all viewed their loved ones as patriotic soldiers. They didn't view them as contractors. Just because they were working with Blackwater instead of being in the Navy SEALs didn't really matter. They were still serving their country. These families thought that their loved ones were working for a patriotic American company. They attempted to get answers from the company about what exactly happened -- how did they end up in Fallujah? I thought my son was going to be guarding Paul Bremer. What's this about kitchen equipment?

As they asked those questions, they say they were stonewalled by the company. At one point, they were flown to Blackwater for a memorial service for their loved ones, and one of the mothers asked to see an incident report of what happened. She claims that a Blackwater representative said, "That's classified information. You'll have to sue us to get it." She then stood up and said, "Well, then we're going to sue you."

These families started to get to know each other. In January of 2005, after investigating it and getting a very high-powered law firm to take the case, they filed a wrongful death case against the company alleging that Blackwater cut corners, didn't provide their loved ones with their contractually guaranteed weapons, adequate personnel, or armored vehicles. The case is being heavily monitored by the war industry. In fact, KBR has filed an amicus brief on behalf of Blackwater in the case. This could be like the tobacco litigation of several years ago, where it just sends shockwaves through the war profiteer community.

BuzzFlash: Where is the case right now?

Jeremy Scahill: Blackwater took it all the way to the Supreme Court, to John Roberts. In late February, the U.S. Supreme Court declined to hear the case. It's interesting, because Blackwater has had high-powered lawyers throughout the process. Blackwater's original lawyer on this case was Fred Fielding, who is now Bush's White House Counsel. And their current lawyer, as of today, is Kenneth Starr, the Whitewater prosecutor. The fact that Blackwater was shot down by the Supreme Court means it is very likely that the case of these four families versus Blackwater is going to proceed in the North Carolina state court, where a jury could find Blackwater liable for the deaths of those four men.

BuzzFlash: Erik Prince appears to be sort of an elusive person. You've mentioned, and it's well documented, that he's an ardent Republican. He's a right-wing Christian, in the vein of Nino Scalia. But he doesn't like publicity a lot -- is that correct?

Jeremy Scahill: To my knowledge, the only places where Erik Prince pops up to actually speak is at conferences where he's surrounded by mercenaries and military brass.

BuzzFlash: But he doesn't grant interviews to the Washington Post?

Jeremy Scahill: No.

BuzzFlash: Is he a multi-millionaire?

Jeremy Scahill: That is my understanding. His father had an auto parts manufacturing business in Michigan. When his dad passed away, the family sold the business for approximately $1.5 billion. Erik Prince basically took his portion of that money and went on to start Blackwater in 1996.

BuzzFlash: Does he personally have a military background?

Jeremy Scahill: Erik Prince was a lieutenant commander in the U.S. Navy SEALs, and he's believed to be the wealthiest person ever to join the Navy SEALs. I think he left reservist duty about a year ago. He had served in Haiti, Bosnia, the Mediterranean. I don't think he wanted to leave the Navy SEALs, but when his father died and his wife got cancer, it just became untenable for him to live the life of a Navy SEAL. He began meeting with other people from the special forces community with this vision of anticipating the enormous profits to be made from government outsourcing of military training.

BuzzFlash: If we look at one of the duties of Blackwater, which is to guard government officials -- is there any logical reason why that could not be done by the U.S. military?

Jeremy Scahill: The primary reason the Bush Administration relied so heavily on private contractors is because it's occupying Iraq -- it's occupying Afghanistan -- these are unpopular wars. There's a real recruitment crisis in the U.S. military.

The unfortunate thing is, oftentimes the debate gets framed as what's wrong with using private forces as a way of bolstering the active duty military. The real question that needs to be asked in this country is why is the United States in Iraq to the tune of 150,000 active-duty soldiers, and another 100,000 contractors, and then a smattering of a few tens of thousands of foreign troops? This is not a war that's supported by the American people. It's not a war that's supported by the people of the world. Rather than questioning these aggressive, offensive wars of empire, we get wrapped up in these debates about is it right or wrong to use private forces. I think it really ends up clouding the issue. The issue is that this Administration uses mercenaries so that it can wage offensive wars around the world. And we're seeing it on the increase, not the decrease.

BuzzFlash: In essence, no one really supports the Iraq war but the Bush Administration

Jeremy Scahill: There are reports as the British pull their troops out, they're going to be replaced by mercenaries. So it's only on the increase. And I think we're going to see a real turn toward Africa with these mercenaries. They're trying to attach themselves onto the multi-billion-dollar peacekeeping budget at the U.N. I think Latin America has a lot to fear from mercenaries.

This has really been a very sophisticated rebranding campaign aimed at radically changing the image of mercenaries and calling them private security companies. These mercenaries are operating in countries that don't want them.

BuzzFlash: A key feature which underlies the entire Executive Branch under Bush and Cheney is that the mercenary forces allow them to have no accountability for military action. There is obviously a military code of conduct, but there is not really a mercenary code of conduct.

Jeremy Scahill: Yes, there is. The trade association for the mercenaries is called the International Peace Operations Association. The logo is a sleeping cartoon lion that looks like it could be from, you know, Lion King II, or something. They have a code of conduct that all their members are required to sign. It looks very good on paper. It's totally unenforceable. It has no legal standing whatsoever. The mercenaries have all sorts of things that look fantastic on paper. We're accountable. We could be prosecuted. It's bad for our business if we act like rogue operators. But in reality, not a single one of them has ended up being prosecuted, and that's a huge problem.

BuzzFlash: Where did the name Blackwater come from? It's very ominous.

Jeremy Scahill: There's actually a lot of debate and speculation about that. Blackwater is located in North Carolina on the Great Dismal Swamp, so it may just refer to the black waters of the swamp.

BuzzFlash: The fact that it has kind of nefarious connotations doesn't hurt. Kind of sends a shiver down your spine if you're at the wrong end of the gun of a Blackwater mercenary.